Correlation Between Rivian Automotive and Marine Products
Can any of the company-specific risk be diversified away by investing in both Rivian Automotive and Marine Products at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Rivian Automotive and Marine Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rivian Automotive and Marine Products, you can compare the effects of market volatilities on Rivian Automotive and Marine Products and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Rivian Automotive with a short position of Marine Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rivian Automotive and Marine Products.
Diversification Opportunities for Rivian Automotive and Marine Products
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Rivian and Marine is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Rivian Automotive and Marine Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marine Products and Rivian Automotive is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Rivian Automotive are associated (or correlated) with Marine Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marine Products has no effect on the direction of Rivian Automotive i.e., Rivian Automotive and Marine Products go up and down completely randomly.
Pair Corralation between Rivian Automotive and Marine Products
Given the investment horizon of 90 days Rivian Automotive is expected to generate 3.49 times more return on investment than Marine Products. However, Rivian Automotive is 3.49 times more volatile than Marine Products. It trades about 0.17 of its potential returns per unit of risk. Marine Products is currently generating about 0.18 per unit of risk. If you would invest 1,029 in Rivian Automotive on September 3, 2024 and sell it today you would earn a total of 194.00 from holding Rivian Automotive or generate 18.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rivian Automotive vs. Marine Products
Performance |
| Timeline |
| Rivian Automotive |
| Marine Products |
Rivian Automotive and Marine Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rivian Automotive and Marine Products
The main advantage of trading using opposite Rivian Automotive and Marine Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rivian Automotive position performs unexpectedly, Marine Products can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Marine Products will offset losses from the drop in Marine Products' long position.| Rivian Automotive vs. GreenPower Motor | Rivian Automotive vs. ZEEKR Intelligent Technology | Rivian Automotive vs. Volcon Inc | Rivian Automotive vs. Ford Motor |
| Marine Products vs. BRP Inc | Marine Products vs. Brunswick | Marine Products vs. EZGO Technologies | Marine Products vs. SCOR PK |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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